1 Under the general permission available, the following categories can freely purchase immovable property in India:

i) Non-Resident Indian (NRI) - that is a citizen of India resident outside India

ii) Person of Indian Origin (PIO) - that is an individual (not being a citizen of Pakistan or Bangladesh or Sri Lanka or
Afghanistan or China or Iran or Nepal or Bhutan), who;

1. at any time, held an Indian passport, or

2. who or either of whose father or grandfather was a citizen of India by virtue of the Constitution of India or the Citizenship
Act, 1955 (57 of 1955). The general permission, however, covers only purchase of residential and commercial property
and not for purchase of agricultural land / plantation property/farm house in India.

No. Since general permission is not available to NRI / PIO to acquire agricultural land / plantation property / farm house in India, such proposals will require specific approval of Reserve Bank and the proposals are considered in consultation with the Government of India.

A foreign national of non-Indian origin, resident outside India cannot purchase any immovable property in India. But, he/she may take residential accommodation on lease provided the period of lease does not exceed five years. In such cases, there is no requirement of taking any permission of or reporting to Reserve Bank.

Yes, but the person concerned would have to obtain the approvals, and fulfill the requirements if any, prescribed by other authorities, such as the concerned State Government, etc However, a foreign national resident in India who is a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal and Bhutan would require prior approval of Reserve Bank. Such requests are considered by Reserve Bank in consultation with the Government of India.

A foreign company which has established a Branch Office or other place of business in India, in accordance with FERA / FEMA regulations, can acquire any immovable property in India, which is necessary for or incidental to carrying on such activity. The payment for acquiring such a property should be made by way of foreign inward remittance through a proper banking channel. A declaration in form IPI should be filed with Reserve Bank within ninety days from the date of acquiring the property. Such a property can also be mortgaged with an Authorized Dealer as a security for other borrowings. On winding up of the business, the sale proceeds of such property can be repatriated only with the prior approval of Reserve Bank.
Further, acquisition of immovable property by entities who had set up Branch Offices in India and incorporated in Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal and Bhutan would require prior approval of Reserve Bank to acquire such immovable property. However, if the foreign company has established a Liaison Office, it cannot acquire immovable property. In such cases, Liaison Offices can take property by way of lease not exceeding 5 years.

(a) Yes, NRIs and PIOs can freely acquire immovable property by way of gift either from
a person resident in India
an NRI
a PIO.
However, the property can only be commercial or residential. Agricultural land/plantation property / farm house in India cannot be acquired by way of gift. (b) A foreign national of non-Indian origin resident outside India cannot acquire any immovable property in India through gift.

Yes, a person resident outside India i.e. i) an NRI ii) a PIO and iii) a foreign national of non-Indian origin can inherit and hold immovable property in India from a person who was resident in India. However, a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal and Bhutan should seek specific approval of Reserve Bank.

A person resident outside India (i.e. NRI or PIO or foreign national of non-Indian origin) can inherit immovable property from (a) a person resident in India. (b) a person resident outside India. However, the person from whom the property is inherited should have acquired the same in accordance with the foreign exchange regulations applicable at that point of time.
Transfer by sales:

(a) NRI can sell property in India to i) a person resident in India ii) an NRI iii) a PIO.
(b) PIO can sell property in India to i) a person resident in India. ii) an NRI iii) a PIO - with the prior approval of Reserve Bank
(c) Foreign national of non-Indian origin including a citizen of Pakistan or Bangladesh or Sri Lanka or Afghanistan or China or Iran or Nepal or Bhutan can sell property in India with prior approval of Reserve Bank to i) a person resident in India ii) an NRI iii) a PIO

(a) NRI / PIO may sell agricultural land / plantation property / farm house to a person resident in India who is a citizen of India. (b) Foreign national of non-Indian origin resident outside India would need prior approval of Reserve Bank to sell agricultural land/plantation property / farm house in India
Transfer by Sale:

i) NRI / PIO can mortgage to: (a) an authorized dealer / housing finance institution in India without the approval of Reserve Bank. (b) a party abroad - with prior approval of Reserve Bank. (c) a foreign national of non-Indian origin can mortgage only with prior approval of Reserve Bank (d) a foreign company which has established a Branch Office or other place of business in accordance with FERA / FEMA regulations has general permission to mortgage the property with an authorized dealer in India.
Mode of payment for purchase :

Payment can be made by NRI / PIO out of (a) funds remitted to India through normal banking channel or (b) funds held in NRE / FCNR(B) / NRO account maintained in India. No payment can be made either by traveler's cheque or by foreign currency notes. No payment can be made outside India.

The amount of refund, together with interest (net of income tax) can be credited to NRE account. This is subject to condition that the original payment was made by way of inward remittance or by debit to NRE / FCNR (B) account. (Please refer to A.P. (DIR) Series Circular No. 46 dated 12.11.2002)

Yes, such loans are subject to the terms and conditions as laid down in Schedules 1 and 2 to Notification No. FEMA 5/2000-RB dated May 3, 2000 as amended from time to time. However, banks cannot grant fresh loans or renew existing loans in excess of Rupees 20 lakh against NRE and FCNR(B) deposits either to the depositors or to third parties [cf. A.P. (DIR Series) Circular No. 29 dated January 31, 2007 i). Such loans can be repaid : (a) by way of inward remittance through normal banking channel or (b) by debit to his NRE / FCNR(B) / NRO account or (c) out of rental income from such property. (d) by the borrower's close relatives, as defined in section 6 of the Companies Act, 1956, through their account in India by crediting the borrower's loan account.
ii). Repatriation : (a). In case the amount has been received from inward remittance or debit to NRE / FCNR(B) / NRO account for acquiring the property or for repayment of the loan, the principal amount can be repatriated outside India. For this purpose, repatriation outside India means the buying or drawing of foreign exchange from an authorised dealer in India and remitting it outside India through normal banking channels or crediting it to an account denominated in foreign currency or to an account in Indian currency maintained with an authorised dealer from which it can be converted in foreign currency (b) in case the property is acquired out of Rupee resources and/or the loan is repaid by close relatives in India ( as defined in Section 6 of the Companies Act, 1956), the amount can be credited to the NRO account of the NRI / PIO. The amount of capital gains, if any, arising out of sale of the property can also be credited to the NRO account. NRI / PIO are also allowed by the Authorised Dealers to repatriate an amount up to USD 1 million per financial year out of the balance in the NRO account for all bonafide purposes to the satisfaction of the authorised dealers, subject to tax compliance.

Yes, NRI / PIO can avail of housing loan in rupees from an Authorised Dealer or housing finance institution subject to certain terms and conditions. (Please refer to Regulation 8 of Notification No. FEMA 4/2000-RB dated 3.5.2000 and A.P. (DIR) Series Circular No. 95 dated April 26, 2003). Such a loan can be repaid (a) by way of inward remittance through normal banking channel or (b) by debit to his NRE / FCNR(B) / NRO account or (c) out of rental income from such property. (d) by the borrower's close relatives, as defined in section 6 of the Companies Act, 1956, through their account in India by crediting the borrower's loan account.

NRI / PIO may repatriate the sale proceeds of immovable property in India (a) If the property was acquired out of foreign exchange sources i.e. remitted through normal banking channels / by debit to NRE / FCNR (B) account The amount to be repatriated should not exceed the amount paid for the property: 1. in foreign exchange received through normal banking channel or 2. by debit to NRE account(foreign currency equivalent, as on the date of payment) or debit to FCNR(B) account. Repatriation of sale proceeds of residential property purchased by NRI / PIO out of foreign exchange is restricted to not more than two such properties. Capital gains, if any, may be credited to the NRO account from where the NRI/PIO may repatriate an amount up to USD one million, per financial year, as discussed below. (b) If the property was acquired out of Rupee sources, NRI or PIO may remit an amount up to USD one million, per financial year, out of the balances held in the NRO account (inclusive of sale proceeds of assets acquired by way of inheritance or settlement), for all the bonafide purposes to the satisfaction of the Authorized Dealer bank and subject to tax compliance.

The sale proceeds of immovable property acquired by way of gift should be credited to NRO account only. From the balance in the NRO account, NRI / PIO may. remit up to USD one million, per financial year, subject to the satisfaction of Authorised Dealer and payment of applicable taxes.

Yes, general permission is available to the NRIs / PIO to repatriate the sale proceeds of the immovable property inherited from a person resident in India. NRIs / PlO may repatriate an amount not exceeding USD one million, per financial year, on production of documentary evidence in support of acquisition / inheritance of assets, an undertaking by the remitter and certificate by a Chartered Accountant in the formats prescribed by the Central Board of Direct Taxes vide their Circular No.10/2002 dated October 9, 2002. [cf. A. P. (DIR Series) Circular In case of a foreign national, sale proceeds can also be repatriated even if the property is inherited from a person resident outside India. But this is allowed only with prior approval of Reserve Bank. The foreign national has to approach Reserve Bank with documentary evidence in support of inheritance of the immovable property and the undertaking and the C.A. Certificate as mentioned above. The general permission for repatriation of sale proceeds of immovable property is not available to a citizen of Pakistan, Bangladesh, Sri Lanka, China, Afghanistan: and Iran and he has to seek specific approval of Reserve Bank. As FEMA specifically permits transactions only in Indian Rupees with citizens of Nepal and Bhutan, the question of repatriation of the sale proceeds in foreign exchange to Nepal and Bhutan would not arise.
Provisions for Foreign embassies / Diplomats / Consulate generals :

Yes, Foreign Embassies / Diplomats / Consulate Generals can purchase and sell any immovable property other than agricultural land / plantation property / farm house in India with prior clearance from the Government of India, Ministry of External Affairs. The payment should be made by foreign inward remittance through normal banking channel.
Other issues :

Yes, NRI / PlO can rent out the property without the approval of the Reserve Bank. Rent received can be credited to NRO / NRE account or remitted abroad. Powers have been delegated to the Authorised Dealers to allow repatriation of current income like rent, dividend, pension, interest, etc. of NRIs / PIO who do not maintain an NRO account in India based on an appropriate certification by a Chartered Accountant, certifying that the amount proposed to be remitted is eligible for remittance and that applicable taxes have been paid / provided for.[cf. A.P. (DIR Series Circular No. 45 dated May 14, 2002].

A person resident in India who is a citizen of Pakistan or Bangladesh or Sri Lanka or Afghanistan or China or Iran or-Nepal or Bhutan is governed by the provisions of Foreign Exchange Management (Acquisition and Transfer of Immovable Property in India) Regulations, 2000 ie. he would require prior approval of Reserve Bank for acquisition and transfer of immovable property in India even though he is resident in India. Such requests are considered by Reserve Bank in consultation with the Government in India

Under FEMA, a person resident in India is defined as a person residing in India for more than one hundred and eighty-two days during the course of the preceding financial year (April-March) and who has come to or stays in India either for taking up employment, carrying on business or vocation in India or for any other purpose, that would indicate his intention to stay in India for an uncertain period. In other words, to be treated as 'a person resident in India' under FEMA, a person has not only to satisfy the condition of the period of stay (being more than 182 days during the course of the preceding financial year) but has also to comply with the condition of the purpose / intention of stay.

Reserve Bank does not determine the residential status. Under FEMA, residential status is determined by operation of law. The onus is on an individual to prove his / her residential status, if questioned by any authority.

A.40 A foreign national resident in India does not require approval from Reserve Bank from FEMA angle, but approvals if any required in terms of regulations prescribed by other authorities such as the concerned State Government etc. will have to be obtained by him / her. However, a foreign national resident in India who is a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal and Bhutan requires specific prior approval of Reserve Bank.